Shell Q2 Earnings Soar As Middle East Tensions Lift Results

Shell plc (SHEL) reported Q2 earnings on July 30, 2026, rising as Middle East tensions pushed oil prices higher. The company cited stronger trading, record refinery runs, and optimization that supported robust operating cash flow and sustained quarterly share buybacks.

Quarter Results and Operational Drivers

Shell said in a press release that adjusted earnings for the quarter reached $9.8 billion, more than doubling year-on-year and marking its strongest quarter in four years. Adjusted EBITDA totaled $20.7 billion, and income attributable to shareholders was $10.8 billion. Operating cash flow was $21.4 billion, including a $3.4 billion working-capital inflow driven partly by higher realized oil and gas prices. The company will maintain its share buyback program at $3.0 billion over the next three months, extending a streak of 19 consecutive quarters at this pace. Free cash flow for the quarter was $17.5 billion, and net debt stood at $41.8 billion at quarter-end.

Chief Executive Wael Sawan said, “Shell's operational performance enabled very strong results during another quarter of severe disruption in global energy markets, as we worked hard to provide critical energy supplies and products to our customers.”

Trading and optimization significantly boosted earnings, with Brent crude averaging about $104 a barrel in the quarter. Volatility from regional disruptions widened spreads, creating opportunities for the trading desks. The closure of the Strait of Hormuz, a chokepoint carrying roughly 20% of global oil and gas flows, forced buyers to seek alternative supplies.

Refining and chemicals also contributed to the gains. Shell reported record refinery utilization, running plants at about 102% of design capacity by temporarily processing more crude to capture higher margins. The refining margin approached $24 a barrel, while chemicals margins rose to roughly $270 a tonne from about $139 a tonne. Jet fuel output increased about 20% year-on-year as refineries shifted runs toward middle distillates to capture premiums amid constrained global jet fuel supply.

Middle East Impact and Production Outlook

Shell’s Middle East operations were directly affected by regional violence. On March 18, 2026, an attack damaged one train at the Pearl gas-to-liquids facility in Qatar, halting production while damage was assessed. Although QatarEnergy LNG was not hit, regional logistics were disrupted. About 20% of Shell’s oil and gas production originates in the Middle East, with roughly 10% tied to Qatar. Damaged or shut assets in the region reduced the company’s output by around 10% overall. The integrated gas division reported a roughly 30% year-on-year decline in production.

Despite these setbacks, record upstream production in Brazil helped offset some losses. Upstream adjusted earnings rose to about $3.5 billion for the quarter, reflecting higher oil prices and diversified assets.

Shell reported integrated gas production of 631 thousand barrels of oil equivalent per day (kboe/d) for Q2 and forecasts Q3 output between 570 and 630 kboe/d, reflecting ongoing regional disruption. The company’s flexible trading and refining runs, combined with diversified upstream exposure, are shaping performance amid continued volatility.